Moneyweb’s investigation reveals identical business models and links to fake ads.
The controversial trading platform Banxso has cloned its operations under a new brand, AfriMarkets.
In effect, this means Banxso continues to trade after its bank accounts were frozen, its Financial Advisory and Intermediary Services (Fais) licence provisionally withdrawn, and the Financial Intelligence Centre (FIC) believing it is a “criminal enterprise designed to defraud innocent members of the public”.
A Moneyweb investigation found that Banxso owns AfriMarkets and shares directors, while its trading platform and business model are virtually identical to Banxso’s.
The most notable is that AfriMarkets’ trading platform is integrated with the registration functions of fake ads through which billionaire celebrities such as Johann Rupert and Elon Musk ‘market’ investment products.
These products promise monthly returns of between R120 000 and R300 000 on a once-off investment of between R4 500 and R4 800. (The ads state different minimum investments and returns.)
AfriMarkets launched in March, a few weeks after Moneyweb and other news titles first reported Banxso’s links to the fake advertising and just before the Financial Sector Conduct Authority (FSCA) initiated an investigation into its operations.
It has a Category I Fais licence, which it received last year.
Banxso’s directors Harel Sekler and Warwick Schneider are also directors of AfriMarkets, while Sekler also owns both companies.
Moneyweb previously linked Sekler to Banc de Binary, one of the largest international binary options scams between 2010 and 2017.
Hendrik Theron of Hanekom Attorneys, on behalf of Banxso and AfriMarkets, stated in response to questions that: “Banxso and Afrimarkets [sic] are wholly distinct legal entities, only sharing common ownership.”
He also strongly denied that AfriMarkets is linked to the fake advertising. “Afrimarkets only employs search engine optimization strategies, an uncontentious, compliant and transparent method of marketing and client acquisition. Any suggestion of involvement in fraudulent social media advertising is entirely false and considered with the greatest degree of contempt.” (Read the full response here.)
Moneyweb’s investigation proved otherwise.
ALSO READ: WATCH: Banxso defies licence suspension
AfriMarkets’ links to Banxso
Several former Banxso employees contacted Moneyweb after the news broke that the platform’s bank accounts were frozen, claiming that AfriMarkets is a carbon copy of Banxso.
“In March, we were informed one morning that Banxso employees will now also work as AfriMarkets onboarding agents. I had a login for both AfriMarkets and Banxso platforms,” one former employee said on the condition of anonymity.
The former employee added that they used the same scripts during conversations. “The only difference was the change in name to AfriMarkets, and we could not invite people to visit the office as we could in the case of Banxso calls.”
The former employees also confirmed that Banxso and AfriMarkets share office space in the Atlantic Centre in Cape Town and that their IT systems and trading platforms are identical.
ALSO READ: The FIC busts Banxso
Moneyweb investigation
Moneyweb initiated an investigation to confirm the claims of the former Banxso employees, as it did earlier this year, which linked Banxso to the fake ads. (Banxso claimed at the time that it was hacked by third parties who inserted leads from the fake ads unwittingly in their systems to cause it reputational damage.)
Moneyweb created two aliases, ‘Jason Steyn’ and ‘Peter Doyle’, and went to Facebook in search of bogus ads.
They were not hard to find. Moneyweb clicked on one, and a blatantly fraudulent and fake article appeared, ostensibly on the SABC’s website.
The article included a deepfake video where journalist Leanne Manas ‘announces’ that Johann Rupert created a new platform that trades automatically without human intervention. Rupert also states in the video that everyone in South Africa can earn a monthly income of R120 000 for an investment of R4 700. (The actual advertisement stated R4 500.)
‘Jason Steyn’ registered in the registration box on the site, and within seconds, the page was redirected to AfriMarkets’ website, where a trading account was automatically created in Steyn’s name.
The trading account contained a credit card payment popup window in which Steyn’s name appeared. Other payment options include electronic payments to Nedbank and Capitec accounts.
Seventy seconds after Steyn registered on the fake ad, his phone rang.
A very friendly Enrico of AfriMarkets was on the line, eager to assist Steyn in starting to invest in “the financial markets”. According to the FSCA website, Enrico Grootboom is a registered representative of AfriMarkets.
Enrico’s approach was virtually identical to the several interactions Moneyweb had with Banxso agents earlier this year.
Enrico used the same terms Banxso agents used in previous interactions with Moneyweb aliases. He introduced himself as an “onboarding specialist” and quickly distanced AfriMarkets from the fake advertising. However, it was clear he was aware of the advertisement.
He also proactively mentioned that the minimum investment amount was R4 500 without Steyn noting that it was listed in the ad. When questioned about it, he responded that it was a generally accepted minimum investment amount. (Moneyweb is unaware of any other trading platform with a minimum investment amount of R4 500.)
Enrico also used other Banxso terms, such as “success manager”, which refers to “professional investment specialists” who would assist Steyn with trading.
Enrico denied any knowledge of Banxso and claimed he was unaware that Banxso and AfriMarkets shared office space in the Atlantic Centre.
ALSO READ: Watch out for old and new scams that can cripple your life
Watch the ‘onboarding’ process
The video below is a real-time account of the whole process, from when Steyn clicked on the fake ad on Facebook to the conclusion of his conversation with Enrico.
Success managers reduce risk to ‘2/10’
Moneyweb conducted another test. After clicking on another bogus ad on Facebook, another fake article appeared. This time, ‘Peter Doyle’ registered.
The unfolding events were exactly the same. In seconds, the page was redirected to a trading account on the AfriMarkets website in Doyle’s name.
The phone call was not as swift this time, but came a few minutes later.
The onboarding specialist was Garth Swartland, and the subsequent discussion was more in-depth and worrisome than with Enrico.
Garth is also listed as an AfriMarkets representative on the FSCA website.
The most concerning thing was that Garth continued with the onboarding process after ‘Peter Doyle’ informed him that he was 51 years old and “retired” as he could not work due to a medical condition and could not afford to lose his savings.
Garth only asked him whether the medical condition was a “mental” one, and after Doyle denied that it was, he continued with the onboarding process.
Doyle repeatedly stated that he did not want to take any risks, as he could not work, and his only income source was his savings.
In response, Garth noted that AfriMarkets’ success managers would reduce the risk.
“We don’t have control over the financial markets, so that’s why we’ll give you a success manager … If you had to do this on your own and we had to put it on a risk scale of one to 10, I’d put the risk at nine or 10. But if you do it with the help of your success manager, remember your success manager is a market specialist, then I will put the risk scale two out of 10.”
Garth never mentioned that the “investments in financial markets” would be highly risky contracts for difference (CFDs).
During the conversation, Garth said 95% of AfriMarket’s clients had no trading experience but that “you did not need experience as the success managers will be with you every step of the way”.
His statements did not echo the tiny fine print on the top of the AfriMarkets webpage: “Trading CFDs requires skills, knowledge, and understanding of relevant risks and is not suitable for everyone; Leveraged trading activity involves substantial risk of losing all invested funds within a short time period.”
ALSO READ: Pay attention: This is how cyber criminals trick you
Listen to the onboarding specialist in action
Listen to the conversation between AfriMarkets’ Garth Swartland and ‘Peter Doyle’ here:
You can also listen to the recording on iono.fm here.
Registered with the FSCA
Enrico and Garth both stressed the company’s registration with the FSCA.
Garth even directed Doyle to the FSCA website and instructed him to confirm that AfriMarkets holds a licence. He directed Doyle to visit the FSCA’s website and enter AfriMarkets’ licence number. He also directed him to visit Hello Peter to read flattering reviews about AfriMarkets.
Banxso’s representatives also did this in previous engagements.
Banxso and AfriMarkets’ trading platforms also mirror each other in design, graphic colour scheme, and data settings. Both even have a button titled “Invest” to activate a trade.
ALSO READ: FSCA warns that scammers are impersonating financial services providers
AfriMarkets’ response
Moneyweb put questions related to this investigation to Theron, who strongly denied any links between AfriMarkets and the fake ads.
Theron did however state that AfriMarkets was “plagued by the same form of social media scamming, and subjected to phishing attacks during early 2024, albeit to an insignificant extent”.
“The company has been inoperative for most of 2024 and as such, these attacks had little to no traction.”
He added that “no leads are contacted without voluntary and/or express consent thereto through Afrimarkets’ official website. Any leads generated from unofficial or third-party channels are categorically excluded from being contacted.”
Moneyweb’s investigation proved otherwise.
Theron also stated that Moneyweb’s investigation does not adhere to the highest journalistic standards.
“It has come to our attention that multiple employees across both companies and their different departments, including onboarding agents, are being contacted in what appears to be an attempt to find inconsistencies or ‘cracks’ in our clients’ operational structures. Your actions in this regard, under the guise of ‘investigative journalism’ is not only undue, but also severely disruptive of our clients’ operations, creating undue stress and detracting from company morale amongst our clients’ employees.
“We have requested, ad nauseam, that any formal comment which is required from our clients should be requested from our offices. Badgering our clients’ employees (and their junior employees, at that), in the hopes of pressuring favourable responses to support your sensationalist journalism is viewed with the utmost contempt.”
Theron also stated that Moneyweb’s articles “have resulted in substantial prejudice to our clients, including the termination of various commercial relationships with several banking partners, together with an investigation by the regulatory authorities – all based on a misstatement of fact and sensationalised ‘journalism’.
“Despite your insinuations, our clients have nothing to hide, nor have they acted with maleficence as you allege.” (Read the full response here.)
This article was republished from Moneyweb. Read the original here.
